The Department of Energy announced this month a Notice of Funding Opportunity for up to $134 million to improve the domestic supply chains for rare earth elements. The funding targets the recovery of rare earth elements from unconventional sources, such as mine tailings, e-waste and other waste materials. 

It’s just one of many initiatives the Trump administration is pushing to develop a domestic supply of rare earths. Ramaco Resources claims its Brook Mine near Sheridan, Wyoming, will satisfy a large chunk of U.S. demand for rare earths and their applications by extracting the resources from clay deposits found between layers of coal. 

Experts have expressed considerable doubts that the mine can economically produce the rare earths Ramaco claims. Last July, Just the News reported that the company’s preliminary economic assessment raised more doubts among experts. 

Critics claim the Wyoming site is no better than anywhere else

In September, the company released a technical report summary, which goes into more details about the resource at the site. James Kennedy, president of ThREE Consulting and Caldera Holding, told Just the News that the grades at the site are no better than what’s found in the soil just about anywhere in the U.S. West, and the economics are based on flawed assumptions. 

Then in October, Wolfpack Research called the mine a “hoax” with a “fantasy economic assessment.” The report includes analysis that Kennedy performed. 

“We would say that Brook Mine is digging a worthless hole in the ground,” the Wolfpack report said. 

Mike Woloschuk, executive vice president of critical mineral operations at Ramaco, disputes the claims. He said the overall grade is low, but the high-value elements in the resource make it a viable project. 

Strategic leverage at stake

The National Energy Technology Laboratory defines rare earth elements — a subset of critical minerals and materials — as "essential materials in a broad range of technologies significant to national security, energy systems, medicine, and consumer products." 

Rare earth elements occur throughout the earth’s crust, commonly at low concentrations. They are not found in an isolated form readily available for extraction, but are distributed throughout a variety of minerals, and are also found in coal and coal by-products.

Rare earth elements are used in a number of military applications, but also in energy infrastructure and consumer goods. China currently produces approximately 60% of the world’s rare earth elements, and controls 90% of its processing. 

President Trump has long recognized the need to break China’s control over critical mineral supply chains. It’s a goal that’s easier said than done, experts in the mineral industry say, but it’s one that defense experts say is vital to national security. 

Kennedy explained that it’s exceedingly rare that a prospective mine ever comes into operation. 

“In the mining industry, there’s so many things that have to go perfectly. For every 1,000 mining projects where somebody goes out and does some core samples and sends them off to a lab and starts prospecting, maybe one gets done,” Kennedy said. 

Location, location, location

Kennedy points out that the technical report summary suggests that Ramaco will need to move 100 million tons of material to produce 40,000 tons of critical minerals over the next 40 years. That puts the rare earth element grade at 0.04% for a large group of rare earth elements and other critical minerals.

The normal background level of rare earths in typical ground soil ranges from 100 to 300 parts per million. Over 50% of Ramaco’s resource, Kennedy explains, is at or near that background range. He said that listing Ramaco’s Brook Mine as a rare earth resource would be like listing “your backyard garden” as a rare earth resource. 

In his analysis of the technical report summary, he says that 90% of the resource does not meet the Department of Energy’s minimum standards to be considered economically viable. 

Questionable price assumptions

He also questions the product pricing used in the economics of the technical report summary, arguing it’s based on faulty assumptions that inflate the price. Kennedy said that the success of the mine would also kill the economics of the report. 

He said that he was at a scandium conference recently — scandium is one of the rare earth elements Ramaco hopes to extract — and the participants were excited about the $3,000 per kilogram price the mineral was fetching. 

However, China then announced it was ramping up production of scandium, which quickly drove the price down to $500 per kilogram. If Ramaco produced the amount of scandium it says the mine will produce, it would double global production, he said. 

If you doubled the production of scandium, its price would probably go below $100 a kilogram,” Kennedy said. 

Basket value shows mine’s potential

Ramaco's Woloschuk said the Brook Mine has high value elements, such as scandium, gallium and germanium, as well as “appreciable” amounts of the heavy rare earths, such as yttrium and dysprosium. While he doesn’t dispute that the total rare earth oxide grade is low, he said that the amount of these high-value minerals — what he calls the “basket value” — make the Brook Mine viable. 

On Friday, Morgan Stanley produced a report on the company’s outlook, and it concluded that the project could transform the company beyond its metallurgical coal business, which is coal that is used for industrial purposes as opposed to electricity generation. 

“While the grades in the Brook Mine are low compared to other rare-earth mines, the project's basket of elements is expected to be of high value… differentiating the development from those that primarily focus on primary magnetic elements,” the report states. 

The report also states that the nature of the clays from which the elements are to be extracted will keep mining costs low. 

Results from pilot plant needed

However, the report concludes, the company will need to show positive results from a pilot plant it will build in the next six months. The company will also need to conduct further drilling to upgrade its mineral resources in the coming months, and complete a pre-feasibility study by the first quarter of 2026 and a feasibility study by late 2027. 

David Hammond, a mineral economist with decades of experience as a mining consultant, explained that as a mining resource is developed, multiple reports come out. The feasibility study is the highest detail and goes a long way to show a mine’s viability. 

“We call it bankable, because that's what you would take to a bank to get a loan on,” Hammond said. 

The Morgan Stanley report also noted that the main risk of the mine is whether it receives meaningful support from the federal government to help build its facility. Technical setbacks, the report said, could jeopardize the company’s ability to ramp up production and could reduce support from the government. 

Debate on extraction methods

"Black Flag Research", the pseudonym of an analyst at Seeking Alpha, released a report earlier this month repeating many of the criticisms other analysts have lobbed at the company, including that the company is relying on unproven extraction methods. 

Woloschuk disputes that claim. 

“What we're planning to do has been used in the mining industry for decades. There's not one thing in our flow sheet that's first of kind. So the equipment that we're using, you'll find it in all kinds of commodities,” he said. 

Black Flag, however, concludes with a recommendation that investors exit the company. “Volatility is high, and there are better opportunities for exposure to critical minerals elsewhere,” the report said. Black Flag's recommendation — with only 93 followers and none from major financial firms — may have little impact on the amount of capital Ramaco can raise. 

Woloschuk said that he’s got a lot personally invested in the mine, and he wouldn’t have done that if the critics’ points were accurate. 

“I certainly had opportunities to go to other projects. I joined Ramaco, because obviously, I believe this project is viable. I wouldn't have made a move halfway around the world if that wasn't the case,” he said.